Murray Zircon Pty Ltd; AUSTRALIAN ZIRCON NL EMPLOYEE AGREEMENT 2009

[2012] FWA 7793

[2012] FWA 7793

FAIR WORK AUSTRALIA

DECISION

Fair Work Act 2009
s.320 - Application to vary a transferable instrument - agreement

Murray Zircon Pty Ltd
(AG2012/9960)

AUSTRALIAN ZIRCON NL EMPLOYEE AGREEMENT 2009
(AC327412)

Mining industry
DEPUTY PRESIDENT BARTEL	ADELAIDE, 10 SEPTEMBER 2012

[1] This decision concerns an application by Murray Zircon Pty Ltd (the employer) pursuant to s.320 of the Fair Work Act 2009 (the Act) to vary the Australian Zircon NL Employee Agreement 2009 (the transferable instrument). The nominal expiry date of the transferable instrument is 26 August 2014. It was made under the Workplace Relations Act 1996, as amended.

[2] The employer took over the operations of Australian Zircon NL (the old employer) on 26 October 2010 and employed a number of transferring employees.

[3] On 23 July 2012 the employer made application to vary the transferable instrument to change its name to “Murray Zircon Pty Ltd Employee Collective Agreement 2009”.

[4] The reasons advanced in support of the application are: A level of a ill will within the community toward the old employer and as a result the employer has made a significant effort to separate the current operations from the old employer; The link to the old employer within the transferable instrument may be viewed by the community as the maintenance of a link to the old employer in circumstances where the employer has made a significant effort to enhance its reputation within the community; The change of name of the transferable instrument would remove ambiguity; A change in name would facilitate a productive relationship with employees in terms of signalling that employment practices are no longer linked to the old employer. 1

[5] The transferable instrument isa collective agreement-based transitional instrument under the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (the TPCA Act). Part 3 of Schedule 11 of the TPCA Act provides that if there is a transfer of business that meets the requirements of s.311 of the Act, then Part 2-8 of the Act (including s.320), as modified by the provisions of the TPCA Act, applies. I am satisfied that a transfer of business has occurred within the meaning of s.311 of the Act.

[6] Section 320 of the Act provides as follows:

“320 Variation of transferable instruments

Application of this section

(1) This section applies in relation to a transferable instrument that covers, or is likely to cover, the new employer because of a provision of this Part.

Power to vary transferable instrument

(2) FWA may vary the transferable instrument:

(a) to remove terms that FWA is satisfied are not, or will not be, capable of meaningful operation because of the transfer of business to the new employer; or

(b) to remove an ambiguity or uncertainty about how a term of the instrument operates if:

(i) the ambiguity or uncertainty has arisen, or will arise, because of the transfer of business to the new employer; and

(ii) FWA is satisfied that the variation will remove the ambiguity or uncertainty; or

(c) to enable the transferable instrument to operate in a way that is better aligned to the working arrangements of the new employer’s enterprise.

Who may apply for a variation

(3) FWA may make the variation only on application by:

(a) a person who is, or is likely to be, covered by the transferable instrument; or

(b) if the application is to vary a named employer award—an employee organisation that is entitled to represent the industrial interests of an employee who is, or is likely to be, covered by the named employer award.

Matters that FWA must take into account

(4) In deciding whether to make the variation, FWA must take into account the following:

(a) the views of:

(i) the new employer or a person who is likely to be the new employer; and

(ii) the employees who would be affected by the transferable instrument as varied;

(b) whether any employees would be disadvantaged by the transferable instrument as varied in relation to their terms and conditions of employment;

(c) if the transferable instrument is an enterprise agreement—the nominal expiry date of the agreement;

(d) whether the transferable instrument, without the variation, would have a negative impact on the productivity of the new employer’s workplace;

(e) whether the new employer would incur significant economic disadvantage as a result of the transferable instrument, without the variation;

(f) the degree of business synergy between the transferable instrument, without the variation, and any workplace instrument that already covers the new employer;

(g) the public interest.

Restriction on when variation may come into operation

(5) A variation of a transferable instrument under subsection (2) must not come into operation before the later of the following:

(a) the time when the transferable instrument starts to cover the new employer;

(b) the day on which the variation is made.”

[7] Having regard to the reasons advanced by the employer for the change in name of the transferable instrument, I am satisfied that s.320(2) of the Act has been met. The change in name will assist in promoting the business interests of the employer by removing any public perception of a connection to the old employer. I have also taken into account that the transferable instrument has two years to operate until the nominal expiry date. If the transferable instrument had only a limited life until its expiry date then this would weigh against the variation sought and support the employer taking steps to negotiate a new enterprise agreement with its employees.

[8] Having regard to the nature of the variation, I am satisfied that none of the matters required to be taken into account under s.320(4) of the Act weigh against the granting of the application.

[9] An order varying the transferable instrument is issued with this decision.

DEPUTY PRESIDENT

 1   Employer written submission dated 5 September 2012.

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